Public Administration (down 30 percent) continued to record the steepest decline in October, dropping to a new low in the Index

As a counterbalance to all the gloom and doom coming from Europe these days:

The Monster Monster Employment Index Europe registered a 14 percent annual growth rate in October. The engineering sector continued to lead the index with the largest year-over-year growth while opportunities in industrial production and related sectors continued to be among top growth sectors. Germany continued to lead all countries in annual growth

All in all, I'd say this is encouraging, and it strengthens the import of the BLS release today of job openings in September, which also registered ongoing gains.

My short answer is no. What is required is for the markets to see acceptable evidence that the countries involved are committed to honoring their debts. This includes all of the necessary and appropriate changes in fiscal behavior over a period of time.

The ECB could bring down the rates on Italian bonds for instance, but chooses not to do so. They are allowing the markets to force spending dicipline on the government. You don't get behavioral change if you enable the perpetrator.

Benjamin: I know of no evidence to support your assertion that a more aggressive monetary policy here and in Europe would create more jobs.

Bill: I agree with John. The ECB is not equivalent to the Fed. The Fed can print all the money needed to pay off Treasury debt. But many of the Eurozone member states, particularly Germany, would not want to see their currency suffer a massive devaluation in order to bail out the spendthrift nations.

The evidence is found in falling unit labor costs, a GDP that is 13 percent below trend and an unemployment rate at 9 percent. I would call that a slack economy.

Of course, in the long run, we must have a pro-business government. (Although supply-side arguments begin to sound funny in a world of international trade--supplies are lush--and in which the dollar is accepted coin of the realm. If we print more money, it pulls in labor, goods, services and capital globally, leading to a boom here--and not much inflation, due to global supply chains. I am still a supply sider, but now is not the time to scream about the supply side when demand is so feeble.)

We have the government we have--I wish it was more pro-business--but demand is weak, and inflation dead. No government is perfect, and will still need a lot more demand.

The economy responded to QE and QE2. The mistake Bernanke made was not to set a target for economic performance and sustain QE until that target was reached. That is rules-based Nominal GDP targeting, or Market Monetarism. A Milton Friedmanesque approach.

The right-wing has sunk into comfortable partisan shibboleths, like "tight money" and that huge defense and rural federal outlays are warranted.

See Japan for how tight money and huge federal outlays work. The economy gets asphyxiated.

Bill: the best solution for Italy and Spain and Portugal is to follow Ireland's example and simply cut government spending. A credible austerity package would do wonders for just about everything at this point. Devaluation of the euro on a scale necessary to shrink the real value of Italian and Spanish debt would be extremely painful for everyone, whereas a credible austerity package would only be painful for those sucking on the public teat.

Ireland's deficits didn't come from undisciplined spending,as is the case in Greece. It came from foolish tax policies. Ireland had a housing bubble and used capital gains taxes to offset cuts in income taxes. Sound familiar?

When the bubble burst, tax revenues dried up. As in business, when it comes to taxes, it pays to diversify.

More at the Economisthttp://www.economist.com/blogs/democracyinamerica/2011/01/austerity_measures

PD: I think there are many that agree with you that the US will never address its fiscal train wreck. But I believe strongly that things have gotten so bad they can only get better. Our problems are so obvious--especially with Greece and Italy as examples--that they must finally be addressed. I have been noting a rightward shift in the electorate that began back in mid-2009 and definitely continues. Next year's elections will be extremely important, but already I think the chances of more conservative fiscal policies are very good.

Also it is important to note that "austerity" policies, which at this point promise to consist of a reduction in spending as a % of GDP and lower and flatter tax rates in exchange for fewer deductions, will be quite stimulative, because they will boost confidence in the future and they will reduce future expected tax burdens.